senate bill on section 232 tariffs

Senate bill looks to reimpose Section 232 tariffs on Mexico

Written by Ethan Bernard

US senators have introduced the “Stop Mexico’s Steel Surge Act,” which seeks to reimpose 25% Section 232 tariffs on Mexican steel imports.

Sens. Sherrod Brown (D-Ohio) and Tom Cotton (R-Ark.), joined by other senators, introduced the bipartisan legislation to “stop the dramatic increase in Mexican steel imports,” according to a statement released on Tuesday.

Additionally, Rep. Frank J. Mrvan (D.-Ind.), joined by other representatives, introduced the Stop Mexico’s Steel Surge Act in the US House of Representatives.

The senators’ statement said the legislation would reinstate the 232 tariffs on Mexican steel imports at 25% for no less than a year, “and give the president authority to impose additional quotas and tariff rate quotas on specific products if needed.”

As for the reasoning, the statement claims the Mexican government is violating the 2019 agreement that removed the tariffs, “and threatening steelworkers in Ohio and around the country.”

Recall that Mexico has said it will place retaliatory steel tariffs on the United States if the US acts to reimpose Section 232.

“Mexico’s violation of its 2019 agreement with the United States has released a surge of steel products into America that’s hurt our workers and made us less secure,” Sen. Cotton said.

“It’s past time for more negotiation. This legislation will stop Mexico from continuing to surge steel into our market,” the senator added.

Lourenco Goncalves, chairman, president, and CEO of Cleveland-Cliffs, said in the statement that Mexico, with increased steel exports to the US, has not lived up to the 2019 agreement.

“To make matters worse, Mexico has become the world capital of circumvention, allowing steel, auto parts, and manufactured products from China and other nations to be routed through Mexico to the US simply to achieve favorable tariff treatment,” Goncalves said.

In December, Brown and a bipartisan group of senators demanded the Biden administration act and set a deadline for Mexico to enforce its 2019 agreement with the US.

Steel trade groups greeted the news favorably.

Kevin Dempsey, president and CEO of the American Iron and Steel Institute (AISI), supported the legislation.

“Action is needed to address the surge in steel imports from Mexico,” he said in a statement on Tuesday.

“We continue to urge the establishment of an effective monitoring system to prevent new surges of steel into the United States from Mexico,” he added.

Likewise, Philip Bell, president of the Steel Manufacturers of America (SMA), applauded the news.

“Over the past year, the SMA has worked closely with the office of the US Trade Representative to curtail the flood of Mexican steel, and this legislation is designed to compel Mexico to act,” Bell said in a statement to SMU on Wednesday.

SMA said the legislation “will help end the massive surge of Mexico steel coming across our border since the signing of the United States-Mexico-Canada Agreement.”

This post appeared first on Steel Market Update.

Latest in Market